Union Bank reports strong performance in 2Q

Union Bank of Colombo PLC has reported a significant upturn in its performance for the period ended June 30, 2013. The Bank's Profit after Tax for the second quarter improved by 119% to Rs. 126.4 million, when compared with the corresponding period in 2012 despite challenging market conditions during the first half of 2013.

Alex Lovell	Anil Amarasuriya

The Bank also recorded Rs. 189.3 million in profits in the first half of 2013, a growth of 18% compared to 2012. The Group profits for the period increased to Rs. 54 million recording a 142% growth and cumulative profits recorded Rs.107.2 million, a decrease of 26% compared to the corresponding period, mainly due to the weak performance in 1Q. Group profits also dipped in compared to the Bank due to the slow performance of UB Finance during the period.

Net Fee and Commission Income increased by 44% during the quarter compared to last year and other income recorded a 201% growth.

The significant increase in other income was mainly due to a disposal of UB Finance shares that was held by the Bank. Total assets of the Bank in 2013 increased by 12% in the first half of the year to Rs. 34.60 million when compared with December 2012 and the Group also recorded a 14% increase to Rs. 36.02 million.

The total equity of the Bank stood at Rs. 5.53 million at the end of June 2013 and Net Assets per share as at the reporting date is Rs. 15.84.

Director and CEO of Union Bank, Anil Amarasuriya said that the Bank had recorded significant growth in the second quarter despite the challenging external environment. He said that the growth the Bank has achieved in this quarter will provide a positive platform to leverage sustainable growth in 2013.

Union Bank also continues to successfully journey towards its aspirations of positioning itself as the 'Top of the Mind' SME Bank in Sri Lanka.

"At Union Bank our focus is clear" said Amarasuriya. "We want to become the 'SME Bank' in Sri Lanka because we know our fundamentals will enable us to add value to this consumer sector".

The Bank will also expand its network to fifty branches by the end of this year which is focused and geared to grow Union Bank's SME portfolio.

Capitalising on the myriad of opportunities in the SME sector, Union Bank's is developing a new Core Banking System, which will complete roll out this year.

This will help to give the Bank a significant upward momentum in technological advancements and assist the Bank to move towards being an IT premiered bank in the country. To accelerate Union Bank's SME presence, a sophisticated robust risk management system was acquired to enable more responsiveness to customers.

Union Bank has also launched a host of new products and ancillary services adding value to the Bank's promise of providing total financial solutions to SMEs and retail customers.